A. Any lease entered into pursuant to the Geothermal Resources Act shall be for a primary term of five years and so long thereafter as geothermal resources are being produced or utilized or are capable of being produced or utilized in commercial quantities from such lands or from lands unitized therewith, subject to continued payment of rentals as provided in Section 19-13-7 NMSA 1978. If the lessee fails to produce or utilize geothermal resources or to discover geothermal resources capable of being produced or utilized in commercial quantities from the lands or from lands unitized therewith during the initial five-year term, the lessee may continue the lease in full force and effect as to the portion held by the lessee for a secondary term of five years and so long thereafter as geothermal resources are being produced or utilized or are capable of being produced or utilized in commercial quantities from such lands or from lands unitized therewith by continued payment each year, in advance, of rentals at the rate set by the lease. Provided that if for any reason beyond the control of the lessee production or utilization of geothermal resources in commercial quantities ceases or if the capability to so produce is temporarily lost after the secondary term has expired, the producing lessee may, with the written permission of the commissioner, continue such lease as to the acreage held by the lessee in effect from year to year for an additional period not to exceed three years by continued payment of rentals as provided in the lease at the rate provided in the secondary term of the lease.
B. If commercial production or capability of commercial production occurs during the primary term and thereafter ceases before the primary term would have expired, the lease shall be deemed to be a "nonproducing or incapable of producing lease" from that date, and the lessee shall have the unexpired portion of the primary term and any subsequent terms within which to resume such production or capability of production. If commercial production or capability of commercial production occurs during the primary term and ceases during the secondary term, the lease shall be deemed to be a "nonproducing or incapable of producing lease" from that date and, upon payment of rentals as provided in Subsection A of this section, the lessee shall have the unexpired portion of the secondary term within which to resume such production or capability of production. When such production or capability of production is resumed, the term of the lease shall continue so long thereafter as geothermal resources are being produced or utilized or are capable of being produced or utilized in commercial quantities from the leased land or from land unitized therewith. In such cases, the rental rate for the lease or the portion thereof shall be the rental rate provided in the term or portion of the term in which such production or capability of production is resumed.
History: 1953 Comp., § 7-15-11, enacted by Laws 1967, ch. 158, § 11; 1979, ch. 386, § 3; 2013, ch. 125, § 4.
The 2013 amendment, effective June 14, 2013, provided for the rental rate of land for geothermal resources when no resources are produced or used; and in Subsection A, in the first sentence, after "subject to continued payment of", deleted "annual"; in the second sentence, after "in advance, of", deleted "annual", and after "rentals at the rate", deleted "of five dollars ($5.00) per acre annually", and added "set by the lease", and in the third sentence, after "continued payment of", deleted "annual".
Structure 2021 New Mexico Statutes
Article 13 - Lease of Geothermal Resources on State Lands
Section 19-13-1 - Short title.
Section 19-13-2 - Definitions.
Section 19-13-3 - Administration of act.
Section 19-13-4 - Geothermal resources of commercial value.
Section 19-13-5 - Leases; applications; limitations.
Section 19-13-6 - Known geothermal resources fields.
Section 19-13-7 - Leases; terms; rentals and royalties.
Section 19-13-8 - Leases; relinquishment.
Section 19-13-9 - Rent or royalties; waiver; suspension; reduction.
Section 19-13-10 - Suspension of operation and production.
Section 19-13-11 - Leases; duration.
Section 19-13-11.1 - Leases; stipulation; rental; royalty.
Section 19-13-11.2 - Validation of geothermal resource leases.
Section 19-13-12 - Combining geothermal resources.
Section 19-13-13 - Reinjecting geothermal resources.
Section 19-13-14 - Cooperative development or operation.
Section 19-13-15 - Posting of open acreage; simultaneous applications.
Section 19-13-16 - State land sales and leases; reservations.
Section 19-13-17 - Use of the surface.
Section 19-13-18 - Bonds; surface damage; performance.
Section 19-13-19 - State lands; jurisdictions.
Section 19-13-20 - General mining lease; lease preference.
Section 19-13-21 - Transferability.
Section 19-13-22 - Inspection of records; reports.
Section 19-13-23 - Violation of lease; notice; forfeiture.
Section 19-13-24 - Removing improvements upon termination of lease.
Section 19-13-25 - Regulations.
Section 19-13-26 - Withholding state lands from lease; lease by competitive bids.